Focusing on the market of more than 95 million people, the “battle” of domestic and foreign retailers, starting from point-of-sale competition, has been gradually entering into differentiation of different types of customers.
Domestic and foreign investors are now promoting their own strategies to find a foothold in the market.
Korean pursuit … advantages are available
In early 2018, the retail group GS Retail from Korea was officially present in Vietnam. GS Retail’s method is to cooperate with Son Kim Land to open GS25 Vietnam chain under the convenience store model.
According to the target, GS25 will open 4 stores in Ho Chi Minh City and 50 stores in 2018, and then expand to Hanoi market. Plan in 10 years, GS25 will open a system of 2,500 stores nationwide.
GS’s direction is somewhat similar to Auchan from France, initially entering Vietnam by cooperating with Sacomreal (now TTC Land) to take advantage of the available space. If Auchan merely works strategically with TTCLand on the infrastructure point and adds utility services for each project that it plans to develop, then GS25 is a joint venture, in which Son Kim Land holds 70% capital. The advantage of the garment industry (the lingerie industry) with the domestic retailers in the Son Kim Land system will be transferred to GS25. The difference is that Korean products from GS Retail are distributed into this system, along with the food factory in Long An, invested by GS Retail.
Although a joint venture with 2/3 of domestic capital, but with the support of the Group’s experience with 12,000 retail outlets from Korea, GS25 has a basis to realize its ambition to be the top retailer in the market.
Japan is aimed at urban customers
Through M&A or cooperation with Vietnamese developers, Japanese investors are also gradually expanding their influence with Vietnamese consumers. 7 Eleven has opened quite a lot of selling points at the moment but did not cause “dizzying” in development speed like the usual style in other Asian markets. 7-Eleven currently has 13 convenience stores concentrated in the heart of HCMC. The company also has a well-segmented customer segment, focusing on young people and offices with convenience goods, fast food instead of home consumption, similar to Aeon’s convenience store group under the Ministop brand.
In addition to the 119 points of the Ministop chain, Aeon also invested 29 Aeon Citimart supermarkets (through purchasing Citimart) and 2 commercial centers in Ho Chi Minh City-Binh Duong.
In addition, Family Mart also from Japan has 160 stores, almost chasing the central areas with the presence of Circle K (USA, 267 stores), continuing to share market share in the urban customer market. and the youth group, office, housewives …
Vietnamese retailer chooses target customers
Vietnamese retailers need to have a coverage strategy and try to stick more with nuclear customers so that the Vietnamese consumer market will not be “swallowed” by foreign retailers.
While both domestic and foreign brands target customer segments with a certain differentiation, Vingroup’s two retail brands, VinMart and VinMart +, have the ambition to become retailers with large scale and coverage. most in Vietnam.
Specifically, Vingroup’s 2 retail brands have more than 57 supermarkets and 1,200 convenience stores, respectively, almost “dominate” the growth rate of selling points / premises.
In addition to the resonance of the corporate brand, VinMart and VinMart + are currently having positive and separate development of their own brands, such as VinEco and VinMart Cook products, meeting the trend of safe, clean and convenient consumption.
Meanwhile, Bach Khoa Xanh is also choosing to develop rapidly in point of sale with about 500 stores, developed by The Gioi Di Dong. Green Department is also positioned to serve essential consumers as part of the “weapon” to target customers – with the consumer class holding the key of income / expenditure of most families. Therefore, the challenge of VinMart and VinMart + is first of all to deepen the gap with domestic and foreign competitors both in terms of selling points and differences.
In other words, in addition to nationwide coverage, Vingroup will need to stick more and more with nuclear customers. This is also a wall for the Vietnamese consumer market to not be “swallowed” by foreign retailers, while those with “age” in the market such as Coop Mart, Satra … can be There is limited capacity in convenience store development, while Bach Khoa Xanh is still a new player who is not ready to accumulate or convert experience selling mobile phones to selling meat and vegetables.
* Source: Business Forum